Commission expected to ask state to fund tax relief effort

The Tennessee Legislature has a bill in the hopper that would cut local tax relief funding to elderly and disabled property owners, and Franklin County is taking steps to counter the move.

The county’s Legislative Committee voted on March 6 to send a resolution to encourage the Tennessee General Assembly to fully fund the State Tax Relief Program for disabled and elderly property owners to the full County Commission.

Commissioners will consider the issue when it meets Monday at 7 p.m. in the Franklin County Courthouse.

The Tennessee Tax Relief Program has been providing much needed financial relief for the disabled, elderly and disabled veterans in Tennessee for more than four decades.

A bill being considered by the Tennessee Legislature could limit the program and drastically alter the way it is administered. The bill would force homeowners under the program to pay for their taxes up front and await a reimbursement from the state.

Franklin County Trustee Randy Kelly says the bill would hurt hundreds of residents who depend on the program to help them pay their property taxes.

“This resolution isn’t asking for anything new, it’s just an attempt to protect what is already there,” Kelly said. “We are trying to stand behind our taxpayers and support them so that they don’t lose assistance that they have become accustomed to receiving.”

Cuts to the program could hit vulnerable residents hard — the elderly and disabled citizens who live on fixed incomes and are already struggling to make ends meet.

The state trustees have gone on record opposing the bill and are requesting that the tax relief program be funded in full for another year.

Under the current program, disabled and elderly (65 and older) homeowners who earn less than $27,800 a year can qualify for property tax relief on up to $25,000 of the market value of their principal residence.

Disabled veterans receive tax relief on the first $175,000 of their home’s market value.

According to Kelly, the program has grown over the years and in Franklin County alone supported around 900 homeowners last year.

Kelly explained that Gov. Bill Haslam’s budget does not include the additional appropriations need to fully fund the program.

For the last two tax seasons, the tax relief program has received $28.4 million in state funding.

Despite an additional $3 million appropriation that had to be made to fully fund the program for the 2013 tax year, only $28.4 million is being proposed by the governor’s office for next year.

The deficit is expected to be about $6 million to make ends meet during the 2104 fiscal year.

The shortfall could mean less tax rebate relief for participants.

Kelly said this means legislators are going to have to either add more funding to the budget or figure out another way to handle it.

“More and more people were added to the program when the income limits were raised,” he said. “The legislators in Nashville voted to increase the income level and they should have been prepared to allocate additional funding that would be needed to meet the demand that came along with that.”

Franklin County matches funds on what the state provides for the elderly, the county does not provide matching funds for disabled enrollees, they only receive the funds provided by the state.

The amount is based on tax rates in the county.

Last year, there were three rates; $167 for property owners outside the city limits, $162 for Cowan, Huntland, Decherd, and Estill Springs property owners, and $153 for Franklin County residents in Winchester and Tullahoma.